WDC/Sandisk Corporation Message Board

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Technology Stocks : WDC/Sandisk Corporation

WDC 140.23

-8.9%

Nov 20 3:59 PM EST

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To: limtex who wrote (19467)	3/6/2001 5:15:14 PM
From: Zeev Hed	Read Replies (2) of 60323

That will make accounting very difficult. When I used to "run things", all costs (as much as possible mind you) was recognized, including the cost of acquiring or building inventory. Then, on the balance sheet, the inventory is stated (at cost or at market which ever is lower) as an asset. The COGS for any given quarter always include cost of product in the pipeline and does not contain the cost of product sold earlier (from inventory) in the quarter, that prior inventory cost is in the prior quarter. Sometimes, you end up with "obsolete inventory", then you must adjust the balance sheet by writing off this inventory and take a hit on the income statement for it as well. Remember the difference between "Income Statement" and "Blance Sheet". Zeev

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